REVENUE-EXPENDITURE NEXUS FOR SOUTHERN STATES: SOME POLICY ORIENTED ECONOMETRIC OBSERVATIONS

Kausik Chaudhuri and Bodhisattva Sengupta

Governance Working Papers from East Asian Bureau of Economic Research

Abstract: The paper examines the temporal relationship between revenues and expenditures for the four southern states during 1980 to 2005. Using an error-correction model and Granger causality test, it finds that the taxspend hypothesis is supported by the analsysis. The spend-tax hypothesis is valid for Karnataka; fiscal synchronization hypothesis is supported for Andhra Pradesh and Kerala, while the data for Tamil Nadu failed to show any causality.

Keywords: Revenue Expenditure; Indian States; Cointegration (search for similar items in EconPapers)
JEL-codes: C22 (search for similar items in EconPapers)
Date: 2009-01
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Citations: View citations in EconPapers (1)

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Related works:
Working Paper: Revenue-Expenditure Nexus for Southern States: Some Policy Oriented Econometric Observations (2009)
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